The cryptocurrency market is experiencing choppy momentum, with total 24-hour liquidations reaching $556 million. This includes $264 million in long orders and $291 million in short orders, underscoring the ongoing two-sided volatility within the market.
Despite this turbulence, several altcoins are demonstrating resilience. Cardano (ADA) is among these, currently trading slightly in the green. Its latest 4-hour chart analysis indicates a potentially bullish reversal pattern that could signal a continuation of its recent upward trend.
Bump-and-Run Reversal (BARR) Pattern Formation
On the 4-hour timeframe, ADA's price action appears to be forming a Bump-and-Run Reversal (BARR) pattern. This is a rare but historically reliable setup that often signals a shift from bearish to bullish momentum.
The pattern's Lead-in Phase began when ADA encountered consistent rejection from a descending trendline around the $0.82 zone. This was followed by a sharp decline, which established the Bump Phase bottom near $0.55.
Subsequently, ADA experienced a strong rebound, successfully breaking above the descending trendline. This breakout signals the commencement of a potential reversal. The price has since pulled back to retest this broken trendline, a classic "throwback" move that frequently serves to confirm the breakout's validity.
At the time of reporting, ADA is trading around $0.6663. It is currently positioned just below its 100-hour moving average (MA), which stands at $0.7213. This moving average now represents a critical decision point. A sustained move above this level could confirm the initiation of the Uphill Run Phase within the BARR structure.
Future Outlook for ADA
Should ADA successfully reclaim the 100-hour MA, the next significant resistance level is projected to be around $0.9288. This level aligns with the technical breakout target, suggesting a potential upside of approximately 38% from its current trading price.
Conversely, if ADA fails to close above the moving average, a short-term pullback or a period of sideways consolidation might occur before any subsequent upward attempts. Nevertheless, as long as ADA maintains its position above the $0.62 support zone, the broader technical setup remains constructive and bullish.
With an improving chart structure and increasing trading volume observed near potential breakout zones, ADA may be quietly positioning itself for its next significant upward movement. Traders are advised to closely monitor ADA's reaction around the $0.72 resistance level in the upcoming trading sessions.